Agenda item

The Police and Crime Panel is required to consider and formally respond to the Police and Crime Commissioner’s Proposed Precept for 2024/25. The purpose of this item is to allow the Commissioner to outline her proposals in more detail and answer any questions that Panel Members might have.

Witnesses:

Lisa Townsend, Surrey Police and Crime Commissioner

Ellie Vesey-Thompson, Deputy Police and Crime Commissioner

Kelvin Menon, Chief Finance Officer & Treasurer (OPCC)

Nathan Rees, Head of Communications and Engagement (OPCC)

Key points raised during the discussion:

1. A Member asked for clarification on the key findings of the public consultation. The Head of Communication (OPCC) explained that 41% supported the £13 precept increase, 11% supported a £12 increase, 2% supported a £11 increase, 7% supported a £10 increase and 39% supported an increase under £10. Overall, 61% of respondents supported a precept rise of £10 or above.

2. A Member asked how many police staff posts the Force would cut if a lower precept was implemented. The Chief Finance Officer explained that the Force would be looking at other ways to make efficiencies and savings before reducing staff. A precise figure could not be provided but each £1 on council tax represented around £0.5 million, which represented around 12 staff posts.

3. A Member queried if it was expected that most Police and Crime Commissioners would be recommending the £13 precept increase. The Commissioner explained that the government had assumed in its funding allocation announcement that all Forces would increase by the maximum amount of £13. The Commissioner’s understanding following discussions with other Commissioners was that they would be seeking the £13 precept increase, apart from in Wales who were seeking more.

4. A Member asked about the 2024/25 proposed revenue budget increase of 7.3% on the current year, which was above inflation and above the pay rise. The Chief Finance Officer explained that the largest element of the increase was the result of the 7% pay rise and increase in pension employer contributions. The Member asked about the £7.1 million of savings required from the revenue budget in 2025/26. The Chief Finance Officer explained that there were plans to address the savings required in 2025/26 including via transformational reviews in criminal justice, rationalising evidence stores and work to streamline paper-based processes. It would be a challenge and there was a risk that savings could be pushed into future years. The Chief Finance Officer explained that an impact on services in 2025/26 was a possibility but work was being done to minimise this. This could also me impacted by a change, such as receiving a larger grant, but the prediction could only be based on the current estimates.

5. A Member queried the current anticipated underspend, and historic underspends against the budget and suggested this cast doubt on whether the full precept increase was needed. The Chief Finance Officer explained that underspends were generally a one-off and had arisen out of specific circumstances. In 2022/23 it was the phasing of recruitment, particularly for uplift officers whereas in the current year it was more to do with additional income. The factors driving the underspends were not considered to be recurrent and hence could not be assumed for future years. Unfortunately, due to the capping rules it was not possible to make up any shortfall in funding through Council Tax in future years and so a more prudent approach was therefore necessary.

6. The Member highlighted that borough and district councils are constrained in the amount they could increase council tax, whereas the amount the Police and Crime Commissioner could increase had generally been more generous. The Member queried if taking the maximum council tax increase in this context was appropriate. The Chief Finance Officer acknowledged that districts and boroughs were more constrained but explained that Surrey Police were the lowest proportionately funded police force in the country.  This meant council tax was relied upon more to fund policing than in other counties. Districts and boroughs also had the ability to raise their own income for example through parking charges and other discretionary services whereas the Force did not have the same ability.

7. A Member asked how confident the OPCC was around the assumptions made on non-pay inflation and what scale of additional financial challenge further inflationary rises would present. The Chief Finance Officer explained that for 2024/25, non-pay inflation had been assumed at 3%, which was in line with the government’s inflation target. 1% on non-pay would add about £600,000 in costs, which was equivalent to about £1.20 on council tax. If this happened the Force would initially look to try to absorb this, such as by renegotiating contracts or buying less, but it could result in staff reductions.

8. A Member asked if the Chief Constable had proposed any specific areas for increased focus and investment if the precept was increased to the maximum amount and how the OPCC would ensure that progress would be robustly monitored. The Commissioner explained that the Chief Constable was looking to deliver the core elements of his vision, which was set out in paragraphs 32 and 33 of the report. For residents, this would include answering calls faster; responding to victims more quickly; increasing the number of offenders charged and crimes detected; improving the response to violence against women and girls, including domestic abuse; maintaining visibility and responding robustly to public concerns about lawlessness. The Force was in the process of agreeing a set of quantitative indicators which would include a baseline and targets for the various objectives of the Chief Constable’s plan. These would be finalised shortly.  An update could be provided at the next Panel meeting.

9. In relation to an increase in the OPCC’s net operating costs of 11.4% in the next year, a Member asked if the Commissioner had considered making any savings in office costs for example through savings in public relations or doing without a deputy. The Commissioner explained that none of the increase in operating costs were due to any change in the office size, it was the result of increases in current staff wages in line with the police pay rise. The Chief Executive (OPCC) explained that the Surrey OPCC was still one of the smallest in the country and it would not be the right time to make any significant changes to the structure of the office right before an election, although any new incumbent may wish to revisit it.

10. A member asked about the 10% vacancy factor budgeted for Police Staff in 2024/25 and how this compared to the current vacancy position of around 13%. The Chief Finance Officer explained that the current level of vacancies in Police Staff was due to challenges in recruitment. Some areas of the Force had a vacancy margin of zero, for example in the contact service, whereas others had a higher factor depending on its operational risk. An element of the transformation work would look to convert excess vacancies into permanent reductions in staffing to embed savings. The areas with the highest current vacancies relate to specialist crime, particularly in forensics, people services and learning and development. Putting police officers into vacant staff posts was something the Force wanted to avoid unless it made sense operationally.

11. In respect of the police funding formula, a Member asked what the Commissioner thought the reasons were for the Home Office treating Surrey unfairly. The Commissioner explained that she did not think the Home Office treated Surrey unfairly but that it was the result of an old funding formula that had been in place for too long. An assumption could not be made that any potential change to the funding formula would benefit Surrey, although the Commissioner hoped Surrey would receive a better deal.  The Member highlighted past comments by the Commissioner that she could persuade the government to change the funding formula to make it more favourable.  The Commissioner stated that ministerial commitments had been made to change the funding formula, and numerous members of the Home Office believed this would happen.

12. A Member asked about reduced estate costs and remote working, and if a financial contingency had been considered if there was a drive to more office-based work. The Commissioner explained that many of the Force’s staff and Officers could do some work remotely, but some areas such as contact, investigations and forensics could not be done remotely. The future estates plan does assume a smaller footprint which would lead to an increased utilisation of space, from the current 32% to 86%, and a reduction in square meters per person, from 14 to 8, bringing the Force more in line with national trends. This reduction in estate operating costs would be needed to fund the re-development of HQ.   

13. A Member noted support for the precept proposal which equated to around 25p per week extra for a Band D property. This represented good value for money for Surrey residents.  A Member asked about the assumption made that the referendum limit for a precept rise in future years would be set at 2% and asked where this figure had come from. The Chief Finance Officer explained that the OPCC had to make a best guess, but it could be higher or lower.

14. Summarising, the Chairman noted his support for the Police as an ex-police officer, but also his appreciation that this was a difficult time for residents many of whom were struggling financially.  The Chairman agreed with the comments made publicly by the PCC that the central government funding formula was unfair and that council tax payments of surrey residents should not be relied upon, disproportionately, to fund the force, as was currently the case.

15. The Chairman noted the recommendation in the report - That the Panel endorse the Surrey Police and Crime Commissioner’s proposal to increase the Precept for a Band D property by £13 (being a 4.2% increase) to £323.57 in 2024/25 – and invited Panel members to vote. A recorded vote was requested. Members were asked to vote ‘yes’ (to endorse the precept), ‘no’ or to ‘abstain’ with the results as follows:

Cllr Barry J F Cheyne- Yes

Cllr Alex Coley- No

Cllr Daniella Newson- No

Cllr Paul Kennedy- No

Cllr Victor Lewanski- Yes

Cllr Nick Prescot- Yes

Cllr Harry Boparai- No

Cllr Keith Witham- Yes

Cllr Richard Wilson- No

Cllr Richard Smith- Yes

Cllr Ellen Nicholson- No

Mr Martin Stilwell (Vice-Chairman)- Yes

Ms Juliet Fryer- Yes

Cllr John Robini (Chairman)- No

16. Seven members voted for the proposal and seven against.  With the Chairman’s casting vote the majority did not support the precept proposal and the meeting was adjourned for private deliberation by the Panel around potential use of the Panel veto.  Summarising this discussion, the Chairman explained that following a lively private debate the result was unchanged and the requirement for a veto to be agreed by two-thirds of the Panel membership was not met.

Resolved:

That the Surrey PCP records:

I.             That a majority of the Surrey Police and Crime Panel (which included the Chairman’s casting vote) did not approve the PCC’s proposal to increase the Band D Surrey Police and Crime Commissioner Precept by £13 to £323.57.

II.            That the requirement for a veto to be agreed by two-thirds of the Panel membership (which equates to 10 Panel members) was not met.

III.          That the Panel accepted that the PCC’s proposal to increase the Band D Surrey Police and Crime Commissioner Precept by £13 to £323.57 will come into effect.

IV.          That the Panel expresses disappointment at the government settlement and the unfair funding formula which places a disproportionate burden on Surrey residents to fund the Force.  This lack of appropriate level of government funding should be resolved and is a more appropriate way to meet Surrey’s needs in the long term.

V.           That the Panel would formally report to the Commissioner noting its concerns and reasons for Panel members not supporting the proposed precept (by 8 February).

Action v: Cllr Witham asked for the Panel’s conclusion around the unfair funding formula which places a disproportionate burden on Surrey residents to be circulated to Surrey MPs.